Jenny Willott the Liberal Democrat Business Minister and MP for Cardiff Central

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Quotas to get women on to the boards of the country’s largest companies are “not needed” and would erode growing trust men have for female executives, the newly-appointed Business Minister has said.

In an interview with the Western Mail Jenny Willott, the Liberal Democrat MP for Cardiff Central, said the UK Government was “on target” to reach a 25% target of women in boardrooms and ruled out the use of quotas to ensure more women got on to FTSE 100 boards.

But she admitted the government had more to do to see ethnic minorities, which had seen “far less positive” progress.

Ms Willott, previously a junior whip in the coalition government, joined Vince Cable’s Department for Business, Innovation and Skills earlier this month, taking on responsibility for employment relations, consumer and postal affairs. She is also Parliamentary Under-Secretary of State for Equalities.

“In the last couple of years, we’ve seen incredible progress in the numbers of women entering the boardroom,” Ms Willott said.

“In 2010, 12.5% of board members of FTSE 100 companies were women. We had a target to increase that to 25% by 2015, and at the moment we are on target to do that as it is about 20.4%. It has been an absolutely huge leap forward. We are certainly on target to hit the target by next year.”

She said that progress validated the voluntary approach taken with companies, with the last two FTSE 100 companies that dropped out were comprised of all-male boards, while the two that replaced them were a mix.

But she said introducing a base quota requirement for women on boards would be a step backwards.

“I would like to see – once we reach the 25% threshold – us set a higher target. The way it has been going means it is making the case that they [companies] are wanting the best people for the job and women have the faith and the trust of companies to do it.

“I would be concerned about having quota requirements on boards as I don’t believe other board members would have the necessary trust in their ability. The way we are doing it at the moment has seen a significant difference to a lot of companies’ behaviour.”

Ms Willott also defended the valuation of the Royal Mail when it underwent a part-privatisation, which has come under fire after the share price rocketed after it floated last year, saying valuing the company at a higher price would have been “completely disastrous”.

Business Secretary Vince Cable had previously said to “judge him in three months” after criticism was levelled at the government’s alleged huge under-valuation of the company, with the share price jumping from 260p-330p [the government’s valuation] each to more than 450p. The current price – more than three months on – is hovering at just under 600p.

But Ms Willott rejected the idea the government had misjudged the value of the company, which implies the taxpayer has lost out on billions of pounds.

“To be honest, at the time it was the value put on the company,” she said. “A lot of work was done about price it should be put on at. It was considered a very risky business because of the pensions history associated with it.

“But actually, that the stock market has gone up just shows how much work that was done to make sure it was in good shape before it was floated. If we had [put it on] at a very high price, people might not have bought the shares because it was too expensive. It would have been completely disastrous.”

Ms Willott also hit out at the ongoing moves towards a referendum on the UK’s membership of the European Union, pointing to Wales’ reliance on Europe for its delicate share of the export market.

She also said that consumer rights legislation for digital purchases which she is steering through Parliament – which would extend statutory rights to digital purchases such as apps, songs and downloads and she claims is a world first – would be hindered by leaving the EU, leaving the law “far more difficult” to enforce, given the EU has acted on a pan-Europe basis to tackle consumer issues.

“Enforcement depends on where they are based,” she said. “If they are elsewhere in the EU, there is a cross-government agreement to make sure similar rules apply and the EU laws like this complement rules elsewhere in the EU.”

She added: “One of the main reasons I have concerns about the debate going on is that the uncertainty is already potentially deterring business, and yes that would have a big effect on Wales in particular.

“The uncertainty that is hanging around over this issues over potential referendums and the fact nobody knows what is going on. It is quite worrying that there is companies appearing saying they won’t invest.”